Oil Rises After Surprise drop in U.S. Inventories

Oil prices rose on Wednesday after a report showed that crude oil inventories in the United States fell against expectations, giving the market some support amid large increases in Covid-19 cases in the United States.

Brent crude futures rose 14 cents, or 0.3%, to $ 43.36 a barrel at 03:26 GMT, after falling 0.4% on Tuesday. West Texas Intermediate crude futures rose a cent or 0.1% to $ 41.06 a barrel, after dropping 1.4% in the previous session.

The Covid-19 pandemic remains dominated by the market and raises concerns about low demand for fuel will cause supply glut. The United States reports a record number of Covid-19 as Texas alone reached more than 40,000 on Tuesday.

Unlike demand, global oil supply is set for a mini growth rally after reaching an astonishing low of 86.4 million bpd in June and an expected 88.2 million bpd in July. The planned output increase from the OPEC+ alliance and the reactivation of other global shut-in production is forecast to push supply to 91.2 million bpd in August, 92.5 million bpd in September, 92.9 million bpd in October and 93.3 million bpd in November, before closing at 93.4 million bpd in December.